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I know it's cliche to rag on MBA's but if there's ever been a group of people who have been "educated stupid" it's MBA holders.
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May 25, 2015 21:10
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sbaldrick posted:I"m not saying PC points aren't useful, I have like 80 bucks of them (because I always get the offers) but too much of the stuff doesn't earn you points and it annoys me to give up some of my shopping habits for points. Get a free PC master card and enjoy a minimum 1% cashback on everything without "sacrificing" your precious shopping habits.
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May 25, 2015 23:12
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sbaldrick posted:I"m not saying PC points aren't useful, I have like 80 bucks of them (because I always get the offers) but too much of the stuff doesn't earn you points and it annoys me to give up some of my shopping habits for points. What does that mean? Like, buy things you wouldn't normally buy? Or essentially sell the data on your habits for points?
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May 26, 2015 00:10
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If the PC points work anything like the US versions of the cards they track pretty much everything you buy.
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May 26, 2015 16:47
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CBC had an article earlier today stating the Tories implied CPP revamp could be on the table to include voluntary contribution increases. http://www.cbc.ca/news/politics/joe-oliver-to-consult-on-voluntary-canada-pension-plan-boost-1.3087896?cmp=rss quote:Finance Minister Joe Oliver says his government is ready to start consulting Canadians on allowing larger, "voluntary," contributions to the Canada Pension Plan.
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May 26, 2015 21:34
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Index investing Q: Is it just me or is the Canadian Couch Potato guy overly keen on bonds and Canadian equity? Would I be nuts to follow an allocation like 35% each US and International equity, 15% each Canadian equity and bonds? I understand that bonds give important stability when you want to manage risk, but as a 23 year old just starting to invest his 40% bonds recommendation seems hefty. (Understanding fully that you kind people aren't my financial advisors and listening to anything you say will automatically make me bankrupt)
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May 26, 2015 21:49
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WaveLength posted:Index investing Q: Is it just me or is the Canadian Couch Potato guy overly keen on bonds and Canadian equity? It's not just you, no. Bonds in general seem like the opposite of low-risk to me right now, and obviously the Canadian equity market is at the mercy of the great Ponzi scheme known as our national housing bubble. I could see an argument for keeping a toe dipped in the Canadian equity pool because "don't try to time markets" etc. (even if I think now is simply not a good time to buy in), but overall I'd agree with you that his bond and Canadian equity allotments are crazy high for this particular moment in history.
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May 26, 2015 21:54
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Franks Happy Place posted:It's not just you, no. Bonds in general seem like the opposite of low-risk to me right now Just hold for the duration: http://canadiancouchpotato.com/2011/07/07/holding-your-bond-fund-for-the-duration/ 40% is crazy high for a young person, but I'd argue that's true irrespective of the point in time.
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May 26, 2015 22:09
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Would there be any reason not to avoid Canadian equity and bonds altogether for the time being?
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May 26, 2015 22:54
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I've been curious about learning about the mechanisms that keep an index ETF tracking the actual value of the underlying assets, and been doing some reading. It's pretty interesting. TL;DR: Price is too high, large institution buys the underlying assets of the ETF, exchanges them to ETF provider for newly created shares of the ETF, and sells them on the market, driving the price back down, and making a no risk profit. Price is too low, large institution buys ETFs on the market (raising the price), and trades them to the ETF provider for the underlying assets, (the ETF shares are "destroyed"), then sells the assets on the market making a no risk profit. Apparently this works super well, with multiple "large institutions" around looking for opportunities to do this. A couple questions for anyone who may be able to answer: -Looking at the volume of something like VXC, I don't see any trades even approaching the 50,000 share "units" that these ETF creations/redemptions supposedly happen in. Surely unless the institution can buy or sell all of the 50,000 shares at once, their no risk arbitrage is ruined, as the price can shift while they slowly accumulate or get rid of 50,000 shares? The daily volume of VXC doesn't get anywhere near 50,000 shares. Is this ETF allowed to be created/redeemed in lower share bundles? -Yesterday, a US holiday, the price got super out of whack. At close, the ETF was trading at $30.62, vs the NAV of $29.94, which is a huge outlier looking back over the history of the price/NAV chart. Is this possibly due to the arbitrage mechanism relying on American firms exclusively? Or something to do with US equity (which makes up the biggest chunk of the ETF) being un-sellable that day?
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May 26, 2015 23:23
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WaveLength posted:Index investing Q: Is it just me or is the Canadian Couch Potato guy overly keen on bonds and Canadian equity? Would I be nuts to follow an allocation like 35% each US and International equity, 15% each Canadian equity and bonds? I understand that bonds give important stability when you want to manage risk, but as a 23 year old just starting to invest his 40% bonds recommendation seems hefty.
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May 27, 2015 03:25
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Yeah, I did very similar... 10% Canadian Bonds, 10% Canadian equity (and they're the only two parts of my portfolio that are negative right now), 20% Europe, 20% International, 20% US in USD, 20% US in CAD.
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May 27, 2015 05:44
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Olive Branch posted:I actually had the same thoughts a couple of months back, WaveLength. I decided that CCP overweighs the "home advantage" and, eventually, switched my weighing from something like 40% Canadian equity, 20% Canadian bonds, 40% international to just 10% Canadian equity, 10% Canadian bonds, 80% international, with the US at a hefty 50%. I figured that the arguments given here about home bias ("you already are paid in Canadian dollars and working locally in Canada" comes to mind) had the tinge of truth to them, and Canada's own representation on the global market is... what, 4% total? I figured that assigning 20% of my entire portfolio to Canada alone was sufficient, and while maybe I am being overly bearish on Canada, the concern really is more to make my allocation more "realistic" with market sizes. A Good Post.
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May 27, 2015 05:45
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I'm: 40% VTI 30% VXUS 10% XIC 20% VAB
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May 27, 2015 06:11
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sbaldrick posted:If the PC points work anything like the US versions of the cards they track pretty much everything you buy. I understand they would probably have access to the Loblaw-related specifics since that's their company (and do based on my "Insider" recommendations), but can they really track what I buy from other companies?
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May 27, 2015 16:39
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Some of you really are making me reconsider my allocations. I've been going with 25% each of CDN, US, and international equity. The last 25% being CDN bonds. Then again I'm only hitting mid 5 figures. Something like 15% CDN Bonds, 15% CDN, 35% US, and 35% international equity might be a bit better once I make the jump to ETFs.
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May 27, 2015 17:56
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I'm 100% VXC. (All-World Equity excluding Canada)  I'm invested enough in Canada as it is through my job both in terms of salary and shares, as well as pretty much anything I stand to inherit one day being Canadian housing.
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May 27, 2015 19:34
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Golluk posted:Some of you really are making me reconsider my allocations. I've been going with 25% each of CDN, US, and international equity. The last 25% being CDN bonds.
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May 27, 2015 20:18
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What's wrong with 25% for everything? My wife and I did that for a bit to keep things simple while learning how to use a brokerage. I rebalanced to 25% VAB/15% VCN/30% VUN/30% XEF (but still feel overweighted in VCN), my wife is something similar.
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May 27, 2015 22:05
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It's better than having everything in one thing, but it's worse than an optimized portfolio based on your life stage and risk tolerance. Ideally you think about overall portfolio composition (equity debt) based on your income vs overall return needs and life stage, then subdivide by various categories based on risk exposures prevalent at the time and then rebalance periodically. Maybe when I get done my level 3 CFA studying I'll do up an effort post about how to construct a personalized portfolio.
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May 28, 2015 03:26
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cowofwar posted:Your allocation is a personal decision but 25/25/25/25 is just bad for many reasons. Are you just incredibly indecisive? It was originally 40% bonds, 20% CDN, 20% US, 20% international, based on CCP. I can't see it being that much worse given I'm putting more weight in equities since I'm still young. Is it optimized? I rather doubt it. But the total value is still small. At this point its more about sticking with it. Edit: Apparently I'm assertive, going by the CCP recommended E-series allocations. http://canadiancouchpotato.com/wp-content/uploads/2015/01/CCP-Model-Portfolios-TD-e-Series.pdf Golluk fucked around with this message at 22:23 on May 29, 2015 |
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May 28, 2015 16:52
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I'm not an expert in this self-directed investing shenanigans, but I try to avoid such notions as "The value of my portfolio is low so there's no need to optimize it now". Every extra dollar gained today is worth double in ten years @ 7% interest. One dollar gained today is worth quadruple in twenty years.
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May 28, 2015 18:09
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Does anyone here manage their RRSP/TFSA as if it were one account, in terms of asset allocations? I've received advice to do this, and I am considering it. Apparently it's more efficient for dividend disbursements or some such? They also mentioned it's more efficient for commissions, but I don't see that being the case, especially since I am with Questrade, so commission free ETF purchases. Or is it more efficient once I retire and start selling/withdrawing? Here is a spreadsheet one could use to manage your portfolio: http://www.moneysense.ca/columns/a-spreadsheet-to-manage-multiple-accounts If anyone is confused, here is an example in my case. Currently my accounts look like this: My TFSA allocation is: VAB - 10% XEC - 15% XEF - 15% XUS - 50% ZCN - 10% My RRSP allocation is: VAB - 10% XEF - 30% VUS - 50% ZCN - 10% If I treat them like a single account, my allocations might look like this: TFSA: VAB - 10% XUS - 90% RRSP: VAB - 10% XEF - 60% ZCN - 30% Rick Rickshaw fucked around with this message at 17:13 on Jun 4, 2015 |
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Jun 4, 2015 16:27
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Short answer, yes, do that. Long answer: As a general rule you should only consider accounts as separate things to the extent they create different tax consequences. You should also decide your optimal portfolio allocation using after tax valuations. For example, depending on your expected retirement tax rate, anything in your rrsp should be treated as v(1-t) in terms of portfolio weights because you'll only ever access it after tax. Anything in tfsa has its face value, and anything in a taxable account is weighted down by the cap gains tax rate to the extent that it's above cost. Asset location, which is different from asset allocation, is the process of deciding which account to put things in to maximize the after tax value. That's what you're doing above.
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Jun 4, 2015 18:21
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Great advice, thanks. Ok, so, if I'm going to consolidate, now is the time to review my ETF choices. Does anyone have any advice on that front? VAB/XUS/XEF/ZCN. I like the iShares ETFs because the MERs are generally so low.
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Jun 5, 2015 14:16
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Is it theoretically possible to sell a house overseas and receive payment for it directly in my canadian bank account, either from another canadian bank account or from a bank in a third country? How will this impact y status as a non-resident for tax purposes?
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Jun 13, 2015 04:08
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Throatwarbler posted:Is it theoretically possible to sell a house overseas and receive payment for it directly in my canadian bank account, either from another canadian bank account or from a bank in a third country? How will this impact y status as a non-resident for tax purposes? Theoretically a bank in another country should be able to wire the money directly into your Canadian account. I have no idea as to whether or not they would do this. Your actual status as a non-resident wouldn't be impacted at all IIRC. Just selling a house in a third country and depositing the money in Canada doesn't count as residential ties here. But of course I'm just an idiot on the internet and not an accountant or lawyer or anything, just some person who had a husband who had to file a tax return as a non resident once.
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Jun 13, 2015 04:21
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HookShot posted:Theoretically a bank in another country should be able to wire the money directly into your Canadian account. I have no idea as to whether or not they would do this. If I were a CRA lawyer I would argue that you actively using your Canadian bank account was an indicator of residency for tax purposes.
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Jun 13, 2015 07:37
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Mantle posted:If I were a CRA lawyer I would argue that you actively using your Canadian bank account was an indicator of residency for tax purposes. If it were literally the only thing tying him to Canada then I doubt that would fly... if he bought a house here and then proceeded to not use it then yeah for sure. But just depositing some cash into a bank account I dunno. But again, that's just me guessing. I think having a bank account here is considered secondary, and you need to have a few secondary ties to count as a RFTP I suppose there's probably case law on this somewhere on the internet.
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Jun 13, 2015 09:25
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HookShot posted:If it were literally the only thing tying him to Canada then I doubt that would fly... if he bought a house here and then proceeded to not use it then yeah for sure. But just depositing some cash into a bank account I dunno. But again, that's just me guessing. I think having a bank account here is considered secondary, and you need to have a few secondary ties to count as a RFTP He didn't ask if it would make him a resident, he asked if it would have an effect on his residency status. The answer is yes, it would have an effect on the analysis.
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Jun 13, 2015 10:05
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The CRA might try to argue that you are now resident. What's wrong with keeping that money overseas?
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Jun 13, 2015 13:42
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If you want to have easy access to that money in Canada but live outside of the country find a Canadian banks local division and put your money there, it works great.
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Jun 15, 2015 15:18
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A couple questions for the thread: First - What are the situations, if any, in which you can move money from an RPP to an RRSP? I have access to an RPP through my employer, who matches up to 5.5%. I'm maxing out the match. I put it all into a target date retirement fund that has a 1.9% annual fee, which seems ridiculous to me, but every other option is even more expensive. Second - With the remainder of my contribution room, I'm probably going to open an RRSP with RBC and do the whole passive investment with index funds thing. Anyone have any experience or advice with self-directed RBC RRSP accounts that they'd like to share? Particularly with any fees that might surprise me? I could possibly use a different bank but the only ones I can visit in person are RBC and CIBC. Third - Any other US citizens in Canada, do you bother with TFSAs? My understanding is that they're a terrible idea along with basically anything other than RPPs/RRSPs. Even having a taxable account in Canada seems like bad idea, so I'm just shoveling anything extra into a taxable US account. Any advice / horror stories to avoid here?
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Jun 15, 2015 18:34
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Unless the RPP is defined contribution with a group rrsp option you aren't going to be able to get it into your rrsp. If you leave the company you may be able to get it into a LIRA depending on the specific plan rules around payout.
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Jun 15, 2015 19:02
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Kalenn Istarion posted:Unless the RPP is defined contribution with a group rrsp option you aren't going to be able to get it into your rrsp. If you leave the company you may be able to get it into a LIRA depending on the specific plan rules around payout. Awesome, thanks. I wasn't familiar with LIRAs but they are exactly what I was looking for. It appears that I will be able to transfer my RPP into one whenever I leave this employer.
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Jun 15, 2015 21:28
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You might have to wait for a while for your employer contribution to vest. I just went through this with my old employer and it's a fairly straightforward process. Lots of paperwork but hey.
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Jun 15, 2015 22:52
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Tarandis posted:Third - Any other US citizens in Canada, do you bother with TFSAs? My understanding is that they're a terrible idea along with basically anything other than RPPs/RRSPs. Even having a taxable account in Canada seems like bad idea, so I'm just shoveling anything extra into a taxable US account. Any advice / horror stories to avoid here?
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Jun 16, 2015 02:49
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A friend of mine has dual citizenship and she has deliberately chosen not to contribute to her TFSA. I don't know exactly how she made that decision but you should almost certainly talk to an accountant about it. For what it's worth it's my understanding that TFSA's are not covered by any tax treaties between Canada and the US whereas RRSP's are covered. Any gains in your TFSA are probably subject to reporting and maybe even taxation in the US. This doesn't necessarily mean you shouldn't contribute to your TFSA at all just that it's probably going to be complicated. The bottom line is that you should probably talk to an accountant because I don't know very much about this.
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Jun 16, 2015 04:14
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A good discussion on this: http://www.theglobeandmail.com/globe-investor/personal-finance/taxes/if-youre-a-us-citizen-beware-these-tax-traps/article9747664/
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Jun 16, 2015 04:26
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Olive Branch posted:Well poo poo. I'm in the same boat as you and have been investing in a TFSA for about a year (almost caught up with the contribution limit). I looked it up and good god, Americans living abroad are just hosed six ways from Sunday, aren't they? I want to know an answer to this too, because I don't make a lot of money and the prospect of shelling out $1,000-$1,500 a year just to prove to the US government that I don't owe taxes is loving ridiculous. I sent you a very long PM, but the tl;dr is talk to a tax professional. It was super helpful for me.
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Jun 16, 2015 07:07
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